Check my work Problem 15-20A (Algo) Determining sales and variable cost volume variances LO 15-2, 15-3, 15-4 Campbell Publications established the following standard price and costs for a hardcover picture book that the company produces. Standard price and variable costs Sales price Materials cost Labor cost Overhead cost Selling, general, and administrative costs Planned fixed costs Manufacturing overhead Selling, general, and administrative $ 37.00 8.20 3.70 6.20 7.00 $128,000 48,000 Campbell planned to make and sell 37,000 copies of the book. Required: a.-d. Prepare the pro forma income statement that would appear in the master budget and also flexible budget income statements, assuming production volumes of 36,000 and 38,000 units. Determine the sales and variable cost volume variances, assuming volume is actually 38,000 units. Indicate whether the variances are favorable (F) or unfavorable (U). (Select "None" if there is no effect (i.e., zero variance).) Volume Variances Master Budget 37,000 Flexible Budgets 36,000 38,000 Number of units Sales revenue Variable manufacturing costs 0 0 Fixed costs $ 0 $ 0 $ 0 Check my work Problem 15-22A (Algo) Return on investment LO 15-6 Fanning Corporation's balance sheet indicates that the company has $550,000 invested in operating assets. During the year, Fanning earned operating income of $60,500 on $1,100,000 of sales. Required a. Compute Fanning's profit margin for the year. b. Compute Fanning's turnover for the year. C. Compute Fanning's return on investment for the year. d. Recompute Fanning's ROI under each of the following independent assumptions: (1) Sales increase from $1,100,000 to $1,320,000, thereby resulting in an increase in operating income from $60,500 to $67,320. (2) Sales remain constant, but Fanning reduces expenses, resulting in an increase in operating income from $60,500 to $62,700. (3) Fanning is able to reduce its invested capital from $550,000 to $440,000 without affecting operating income. Complete this question by entering your answers in the tabs below. Req A to C Req D Compute Fanning's profit margin, turnover and return on investment for the year. (Round "Profit margin" and "Return on investment" to 1 decimal place (i.e., 0.234 should be entered as 23.4).) % a. Profit margin b. Turnover times c. Return on investment % Complete this question by entering your answers in the tabs below. Req A to C Req D Recompute Fanning's ROI under each of the following independent assumptions: (Do not round intermediate calculations. Round your answers to 2 decimal places. (i.e., .2345 should be entered as 23.45).) (1) Sales increase from $1,100,000 to $1,320,000, thereby resulting in an increase in operating income from $60,500 to $67,320. (2) Sales remain constant, but Fanning reduces expenses, resulting in an increase in operating income from $60,500 to $62,700. (3) Fanning is able to reduce its invested capital from $550,000 to $440,000 without affecting operating income. Show less Return on Investment % (1) (2) (3) % %
